Political Market for Agricultural Protection, The

Lilyan E. Fulginiti
April 1992 [92-GATT 5]

Why do poor countries tax agriculture more than other sectors, whereas rich countries subsidize farmers? Using the neoclassical economic theory of the political market for Distortionary policies, an explanation is sought by examining changes to factors affecting the supply and demand curves in that political market. The aggregate effect of these changes is a shift in both the demand curves and the supply curve to the right as industrialization proceeds.